Individuals who are employed by or acting for the corporation to carry out the regulated activity are required to be an appointed, provisional or temporary representative under the SFA.

CRITERIA FOR GRANT OF A CMS LICENCE

General CriteriaA CMS licence will only be granted to a corporation. For applicants that are incorporated in a foreign country, they should satisfy MAS that the branch in Singapore would be subject to proper management oversight and be able to comply with all laws and regulations governing its operations.

The applicant is a reputable entity that has an established track record in the proposed activity to be conducted in Singapore or in a related field, for at least the past 5 years.

The applicant establishes and operates out of a physical office in Singapore.

Criteria in respect of the Board of Directors, Chief Executive Officer and Representatives of the Applicant

The applicant’s board of directors should comprise a minimum of 2 members, at least one of whom is resident in Singapore.

The chief executive officer of the applicant is resident in Singapore.

The applicant employs at least 2 full time individuals who are appointed representatives for the relevant regulated activity as required under the SFA. Such an appointed representative has to satisfy the following minimum entry requirements:

(a) be at least 21 years old; and(b) satisfy the minimum academic qualification and examination requirements.

Base Capital RequirementsThe applicant should satisfy the base capital requirements [“BCR”] for its proposed regulated activities. The BCR for each regulated activity may be found in Annex 1.

Letter of Responsibility / Letter of Undertaking RequirementMAS may impose a condition requiring the applicant to procure a Letter of Responsibility or a Letter of Undertaking from its parent company.

The Letter of Responsibility is a commitment from the applicant's parent company that it will maintain adequate oversight over the applicant's operations, financial position, compliance with laws, management and other relevant issues. The Letter of Undertaking sets out the maximum liability of the applicant’s parent in support of any liquidity shortfall or other financial obligations.

Criteria Specific to Certain Regulated ActivitiesAn applicant which is applying to carry out the regulated activity of trading in futures contracts should have minimum group shareholders’ funds of S$100 million.

Additional Licence Conditions for Applicants which do not satisfy all Criteria

MAS may grant a CMS licence to an applicant which does not satisfy all the requirements at the time of application, subject to such additional conditions to be imposed, such as requiring the applicant to procure a banker’s guarantee, PII or Letter of Undertaking.

Annex 1 – Base Capital Requirements (BCR)Where more than one BCR is applicable, the amount of BCR required shall be the highest of the applicable BCRs.

(A) Trading in Futures Contracts

Regulated Activity BCR (S$)

Trading in futures contracts 5 million(clearing member)Refers to a corporation which is a member of a designated clearing house authorised to operate a clearing facility for futures contracts, where the corporation’s membership is not limited to specified commodity futures contracts.

Trading in futures contracts 1 million(non-clearing member)Refers to a corporation (not being an introducing broker or restricted broker in relation to trading in futures contracts) which is a member of a futures exchange.

Trading in futures contracts 1 million(non-member)Refers to a corporation (not being an introducing broker or restricted broker in relation to trading in futures contracts) which is not a member of a futures exchange.

Trading in futures contracts 500,000(introducing brokers)For the purposes of trading in futures contracts, refers to a corporation which does not carry any customer’s positions in futures contracts, margins or accounts in its own books, and either (i) carries on the business only of soliciting or accepting orders for the purchase or sale of any futures contract from any customer (not being a restricted broker); or (ii) accepts money or assets from any customer as settlement of, or a margin for, or to guarantee or secure, any purchase or sale of futures contract by that customer.

Trading in futures contracts 250,000(restricted broker)In relation to trading in futures contracts, refers to a corporation which (i) does not carry any customer’s positions in futures contracts, margins or accounts in its own books; (ii) trades in futures contracts only with accredited investors; (iii) does not accept money or assets from any customer as settlement of, or a margin for, or to guarantee or secure, any purchase or sale of futures contract by that customer; and (iv) enters into one or more transactions with any customer to deal in futures contracts as principal.

Trading in futures contracts (others) 50,000In relation to trading in futures contracts, refers to a corporation which (i) does not carry any customer’s positions in futures contracts, margins or accounts in its own books; (ii) trades in futures contracts only with accredited investors or institutional investors; (iii) does not accept money or assets from any customer as settlement of, or as a margin for, or to guarantee or secure, any purchase or sale of futures contract by that customer; and (iv) does not enter into any transaction with any customer to trade in futures contracts as principal.

Trading in futures contracts 1 million(clearing 1 million member limited to specified commodity futures contracts)Refers to a corporation which is a member of an approved clearing house authorised to operate a clearing facility for futures contracts, where the corporation’s membership is limited to specified commodity futures contracts. The applicant engaged in this regulated activity may be required to maintain and hold its financial resources [as defined in the Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) Regulations] [“SF(FMR)”] in such manner in Singapore as may be specified by MAS.

(B) Trading in Commodities Futures Contracts

Regulated Activity BCR (S$)

Trading in specified commodity futures 1 millioncontracts only (clearing member)Refers to a corporation which is a member of a clearing house authorised to operate a clearing facility for futures contracts, where the corporation’s membership is limited to specified commodity futures contract. The applicant engaged in this regulated activity may be required to maintain and hold its financial resources [as defined in the SF(FMR)] in such manner in Singapore as may be specified by MAS.

Trading in specified commodity futures 500,000contracts only (non-clearing member)Refers to a corporation (not being an introducing broker or restricted broker in relation to trading in futures contracts) which is a member of a futures exchange.

Trading in specified commodity futures 500,000contracts only (non-member)Refers to a corporation (not being an introducing broker or restricted broker in relation to trading in commodity futures contracts) which is not a member of a futures exchange.

Trading in specified commodity futures 250,000contracts only (introducing broker)In relation to trading in specified commodity futures contracts, refers to a corporation which does not carry customers’ positions, margins or accounts in its own books; and either (i) carries on the business only of soliciting or accepting orders for the purchase or sale of any specified commodity futures contract from any customer (not being a restricted broker) or (ii) accepts money or assets from any customer as settlement of, or a margin for, or to guarantee or secure, any purchase or sale of specified commodity futures contracts that customer.

Trading in specified commodity futures 250,000contracts only (restricted broker)In relation to trading in specified commodity futures contracts, refers to a corporation which (i) does not carry any customer’s positions in specified commodity futures contracts, margins or accounts in its own books; (ii) trades in specified commodity futures contracts only with accredited investors; and (iii) does not accept money or assets from any customer as settlement of, or a margin for, or to guarantee or secure, any purchase or sale of specified commodity futures contract by that customer